Brightening the Future

Ayala: With solar lantern in hand, kicking off a campaign to light the rural Philippines.

Photo courtesy Jim Ayala

After a successful corporate career that included two decades as a senior partner at McKinsey & Company and, most recently, five years as chief executive of the oldest real estate firm in the Philippines, Jaime “Jim” Ayala (MBA ’88) decided to put his considerable business experience to work improving the lives of some of his native country’s poorest citizens. Explaining his 2009 decision to leave Ayala Land, which had seen a 130 percent growth in revenues under his leadership, Ayala told BusinessWorld, “...there was a confluence of things.” In the June 2 article, Ayala (who is not related to the Ayala family that owns Ayala Land), elaborated, “In all our lives there are certain times when you feel that God is telling you something. It is the time to listen.”

In May 2010, that inner voice led Ayala to launch Hybrid Social Solutions, Inc. (HSSI), a Philippine social business that distributes solar lanterns and water filtration devices specifically designed for the needs of poor communities. HSSI’s solar supplier is SunTransfer, a social enterprise Ayala cofounded, that has similar distribution partners in Ethiopia, Kenya, Senegal, and Argentina. Both companies are affiliated with the Stiftung Solarenergie International Network for Rural Development, a German foundation dedicated to development aid. The three organizations are working together to build a solar ecosystem that will improve access to electricity in off-grid communities across the globe. “It sounds complicated,” Ayala says, “but we set it up this way to have a globally scalable business model.”

Stiftung Solarenergie Philippines, which Ayala chairs, recently completed a unique kick-off to its efforts to improve living standards and open new possibilities for the 20 million (one in four) Filipinos who live in remote areas and lack reliable access to electricity. In May, three motorcycle riders embarked from Manila, leading an HSSI team that distributed 600 solar lanterns to inhabitants of 80 rural, off-grid Philippine villages. The well-publicized “Ride for Light” was intended to call the country’s attention to the need for safe, sustainable power alternatives to the widespread reliance on kerosene, wood, and batteries, which carry high financial, environmental, and health costs.

Although Stiftung Solarenergie donated the first lanterns, Ayala, who identifies himself as a “social businessman,” said the plan is to tie the new power source to self-sustaining community development initiatives. “Even simple products such as portable lanterns with phone chargers can transform daily life,” Ayala notes. Under the auspices of community partnerships, the lanterns will be used in public facilities such as schools and clinics during the day and rented out for a nominal fee at night. The rental fees can be pooled to enable the community to purchase additional lanterns. The model of a business that can help the poor while remaining economically viable is in keeping with Ayala’s career shift away from the for-profit focus on maximizing shareholder value. In his new venture, he told BusinessWorld, “We want to maximize social impact.”

Ayala says his HBS background has been valuable in working with government and NGO players to get his hybrid solar network up and running. “To have large scale and sustainable impact in helping the poor, it is essential to enlist the power of business and the markets in a way that complements the work of NGOs, charities, and governments,” he notes. “Everything I learned at HBS — from marketing to strategy to finance to BGIE — is relevant in running a social business.”

For MBAs who may be considering a mid-career leap to the social enterprise sector, Ayala has words of encouragement. “HBSers are known as ‘Captains of Industry,’ although the School is really about developing leaders who make a difference in the world,” he observes. “By adjusting their business paradigms to put more emphasis on adding value to society and focusing on the needs of the poor, business leaders can make a huge difference in their communities. And they will find greater personal fulfillment in the course of doing good while doing well.”